Swiss e-commerce has to contend with Asian competition

by | 26 Sep 2024 | Digital

Swiss e-commerce is facing significant challenges due to the growing competition from Chinese platforms such as Temu, Shein, and AliExpress, in a context where artificial intelligence (AI) is profoundly transforming the sector.

This is the finding of a study conducted by ZHAW, the Zurich University of Applied Sciences, which highlights how the spread of these Asian platforms is putting increasing pressure on Swiss operators.

Survey by the ZHAW University of Zurich

According to the survey, four out of ten Swiss operators report being directly affected by competition from Chinese platforms. Among them, 26% report price pressure, 22% cite increased competition, 14% experience reduced margins, while 12% observe an excess supply and another 12% report a drop in sales.

However, 61% of respondents have not yet experienced direct consequences, but experts warn that the situation could change if platforms like Temu further expand their product range and strengthen their presence in the European market.

Differentiation and quality strategies

To counter Asian competition, Swiss retailers aim to differentiate themselves through product quality and superior customer service.

This approach is crucial in a market where competitiveness is constantly increasing, and local operators must find the right balance between price and quality to remain relevant in the eyes of consumers.

The growing role of artificial intelligence

The ZHAW study also highlights the growing impact of artificial intelligence in online commerce. More than half of the retailers surveyed (53%) already use AI for content creation, and 54% use it for text translation.

Additionally, 42% rely on AI for product descriptions, noting that these technologies play a key role in improving the quality of information, optimizing search engine results, and ultimately increasing sales.

Darius Zumstein, head of the study, emphasized how AI enables time and cost savings while improving data quality. This impact often results in greater visibility on search engines, a decisive factor for online sales.

In addition to search engine optimization, AI is increasingly used for creating images and videos, thus expanding marketing opportunities for retailers.

Challenges and future potential of AI

Despite the many advantages, 44% of retailers see AI as a challenge. The main difficulties concern the lack of specific skills and the complexity of integrating these technologies into existing business processes.

Furthermore, some operators complain about the still imperfect quality of some AI-based solutions.

As Fabian Oehninger of ZHAW points out, another issue lies in the fact that nearly a third of companies do not invest in employee training, an aspect that could compromise long-term competitiveness.

AI remains underutilized in personalization and customer service, with only 9% of companies adopting solutions such as chatbots or digital sales assistants. However, a growing number of operators are testing new applications in this area, signaling an upward trend for the future.

The dynamism and complexity of online marketing

At the same time, Swiss online commerce continues to evolve in terms of marketing. Increasingly, products are being marketed through search engines and social platforms like TikTok, Instagram, and YouTube.

However, this high level of dynamism brings new challenges for retailers: pressure on prices and costs is increasing, while available resources are often insufficient to manage the growing complexity and market requirements.